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Managing Supplier Relationships in the New Normal

December 14th, 2009 · by Sundar Kamakshisundaram · 2 Comments · best practices, supplier management, supply management, supply risk

Coming out of the global economic crisis, a new business climate is taking shape that will permanently change the way organizations need to deal with Buyer-Supplier Relationships. The old normal was a world where credit was freely available. In the new normal credit will no longer be easy and we’re going to face an inflation risk. This has driven many suppliers to choose which customers they want to serve. So now is the time for many Buying organizations to become a “Customer of choice” since it might be too late when markets become tight and are forced to line up with other buyers to get suppliers attention.

Best-in-class companies leverage collaborative Supplier Management as a means to mitigate Supply Chain Risk and also use as a competitive differentiator to drive substantial bottom-line revenue growth and profitability. But the path to a success Supplier Management initiative requires not only a world-class web based technology and tools but also structured processes, expertise and access to a networked community to succeed.

Top “Lessons Learned” for enhanced Buyer-Supplier Relationships in the “New Normal”:

  1. Learn to operate in the “New Normal” - Agility and information are the keys to success
  2. Supplier Collaboration is the new way to work with suppliers in the new normal. Collaboration jumpstarts Innovation
  3. Suppliers can pick customers they serve and it is imperative for buying organizations to become “Customer of Choice”.
  4. Suppliers in all industries and geographies are in a very different position than just two years ago
  5. Supplier Management don’t have to be a complex, laborious undertaking with “no light” at the end of the tunnel (can be turned into a competitive advantage using a structured approach to manage suppliers)
  6. Total visibility in the supply chain and suppliers substantially improves efficiency and competitiveness in organizations
  7. Supply Risk is not going away just because the economy is getting better

Sundar Kamakshisundaram is a Senior Solutions Marketing Manager for Ariba, a global provider of spend and supply risk management solutions.

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2 responses so far ↓

  • 1 Supply Chain Management Doctor // Dec 15, 2009 at 12:17 pm

    Whilst I avidly consume many blogs relating to Supply Chain Management, I haven’t as yet come across a more precise description of how to implement a “Collaborative Supplier Management” strategy. Great work, Matthew @ Perceptant.com

  • 2 Supply Chain Management Doctor // Feb 8, 2010 at 6:19 am

    Supplier Collaboration has until recently been limited to a handful of B2B messages, losely integrated.

    This works with a few suppliers but when a retailer or manufacturer has hundreds or thousands it’s impossible.

    Saas (Software as a Service) and fully-managed supply chain broker solutions change this though and many of our customers are now exchanging messages, integrating business processes and collaborating in real-time with entire trading communities.

    Perceptant is a recognised expert in Supply Chain Management & Electronic Data Interchange (EDI) and has been linking supply chains for over 20 years.

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